Chery Automobile plans to grow car sales by nearly 20% in 2009 with help mainly from government support to bolster demand amid a slowing economy.

Chery plans to sell 17.7% more cars this year,  419,000 units, chairman Yi Tongyao said in a statement cited by Reuters.

Chery posted a rare decline of 6.56% in 2008 as the global recession took a toll on the once-booming industry but January sales hit a monthly record of over 35,000 cars, the statement said, making it China’s largest national car brand, lagging behind only the General Motors, Volkswagen, Hyundai Motor and Nissan Motor joint ventures.

Analysts reportedly attributed the rebound to the government’s recent policy incentives, including halving purchase tax for cars with engine sizes below 1.6 litres.

“The policies are a big help for companies like Chery and Geely as they are mostly playing at the lower-end segment,” Changjiang Securities analyst Yi Junfeng told Reuters.

Geely Automobile last month said it aimed to grow its car sales by a quarter in 2009.

SUV maker Great Wall Motor, diversifying into small car production, has targeted a 70% jump in its vehicle sales this year, a company executive told Reuters last month.

Car sales growth in China slowed to a single-digit rate in 2008 for the first time in at least a decade, prompting the government steps to bolster the industry.

Chery has also said it plans to launch over 10 new models in 2009.